Investors’ Fears Eased But Not Gone
Halloween failed to spook a jittery stock market Friday, as stocks gained modestly to wrap up a historic and volatile week that included the Dow industrials’ biggest ever point loss and gain.
On Wall Street, the Dow Jones industrial average rose 60.41 at 7,442.08, settling for comparatively small gains after climbing 114 points in the first hour of trading and taking a 29-point midmorning loss.
The pendulum-like Dow eased from wild swings Monday and Tuesday to more restrained fluctuations as investors’ fears eased.
“Once you’ve taken a big knock, you don’t lose that fear overnight,” said Ronald J. Hill, investment strategist at Brown Brothers Harriman & Co. “It’s like a healing process. Once you get centered on the fact that the fundamentals remain positive, we would expect to see new highs in equities” by year’s end.
Volume on the floor of the Big Board came to 629.02 million shares, down from 707.84 million in the previous session.
Broad-market indexes also rallied at the opening bell, but weakened somewhat as the day progressed. The Nasdaq Stock Market, battered recently from a selloff in technology stocks, rose Friday.
As the week drew to a close, the Dow was down 275 points for the week and up more than 15 percent for the year. Nevertheless, many investors feared a new trigger could set the market’s gyrations in motion again.
“There’s still a lot of jitters out there, which is causing volatility,” said Brian Belski, technical analyst at Dain Bosworth in Minneapolis. “You don’t have the huge moves we’ve seen this week and then just resume trading like nothing happened.”
Helping to calm global markets was a rise in major Asian indexes and European markets that ended the day little changed. That followed a week of turmoil in international markets, caused by concerns over the financial outlook of Asia.
At the end of a week dominated by Asian concerns, traders were greeted by the leader of Hong Kong’s parent, China. Jiang Zemin, China’s president, rang the opening bell of the New York Stock Exchange, grinned broadly and shouted to the traders on the floor 20 feet below, “Good morning! I wish you good trading!”
Also boosting stocks Friday was news of an International Monetary Fund bailout package for Indonesia, with the United States joining the rescue effort with a commitment of its own.
Advancing issues outnumbered decliners by a 7-to-3 margin on the New York Stock Exchange, with 2,089 up, 897 down and 450 unchanged.
The Standard & Poor’s 500-stock list was up 10.94 to 914.62, and the NYSE composite index was up 5.28 to 481.14.
The Nasdaq composite index was up 23.20 to 1,593.61, and the American Stock Exchange composite index was up 4.91 at 675.75.
Overseas, Tokyo’s Nikkei stock average rose 0.6 percent, Frankfurt’s DAX index was unchanged and London’s FT-SE 100 rose 0.8 percent.